Accounting giant Ernst & Young will pay a $100 million fine by the U.S. Securities and Exchange Commission (SEC) after the regulator found that hundreds of auditors had cheated during CPA exams, and the company did not take action to stop it.

According to the SEC's press release, EY auditors cheated on the ethics portion of the standard exams used to obtain and maintain accounting licenses. Furthermore, the company withheld information from SEC investigators, with an internal tip exposing habitual cheating not being shared with the regulator's Enforcement Division.

"This action involves breaches of trust by gatekeepers within the gatekeeper entrusted to audit many of our Nation's public companies," SEC Enforcement Division Director Gurbir S. Grewal said. "It's simply outrageous that the very professionals responsible for catching cheating by clients cheated on ethics exams of all things. This action should serve as a clear message that the SEC will not tolerate integrity failures by independent auditors who choose the easier wrong over the harder right."

At least 50 EY auditors shared answer keys for the ethics examination between 2017 and 2021. "Hundreds" of employees are believed to have cheated on professional education courses required by regulations. Several employees who did not cheat are also believed to have facilitated cheating by co-workers.

EY has admitted to the breaches of regulations and attempted to misrepresent the situation in communications to investigators. In addition to paying the $100 million fine, the company has also agreed to retain two independent consultants to review its ethics procedures and its disclosure failures. For its part in the debacle, the company has stated that it will take additional steps toward ensuring compliance.

"We are confident that the outcomes of the undertakings will reinforce steps we have already taken in the years since these situations occurred," EY wrote in a statement. "Sharing answers on any assessment or exam is a violation of our Code of Conduct and is not tolerated at EY. Our response to this unacceptable past behavior has been thorough, extensive and effective."